Thursday, December 24, 2015

Chipotle's (CMG) E. coli Outbreaks are Causing Long-Term Damage to their Brand/Reputation and We Predict > 70% of WS Analysts will be Forced to Downgrades Sales & EPS Forecasts through at Least 2017

“Frustratingly, there is no good precedent for Chipotle’s food safety issues,” wrote RBC Capital Market analyst David Palmer. But citing Taco Bell’s past troubles, he forecast a year of sales declines for Chipotle.

Barclays analyst Jeffrey Bernstein has noted Chipotle’s recovery may take longer than other chains that have been hurt by foodborne illnesses, because social mediahas increased people’s awareness of such incidents.

He also noted that Chipotle’s “Food With Integrity” slogan makes the E. coli (fecal contamination) cases all the more damaging.

We clipped this piece from an article written by Candice Choi from The Associated Press.